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If you find that a stock is currently trading at $48, and a put and a call option, both with the same expiration of 1
If you find that a stock is currently trading at $48, and a put and a call option, both with the same expiration of 1 year and strike price of $50 are trading at the following prices (call = $2.30, put = $4.00), with risk free rate of 5%, what action could you take to make certain profits?
a.Buy a call, lend PV(50), and buy a stock and a put
b.Buy a call, lend PV(50), and short a stock and put
c.Sell a call, borrow PV(50), and buy a stock and put
d.Sell a call, borrow PV(50), and short a stock and put
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